India’s tech startup funding falls 18% in FY26 as late-stage deals drop, Tracxn says
India’s technology startups raised $11.7 billion in FY 2025-26, an 18% decline from $14.3 billion a year earlier, as late-stage financing slowed even while early-stage rounds gained momentum, according to Tracxn’s India Tech Annual Funding Report 2026 released Wednesday.
The total remained 20% higher than the $9.7 billion recorded in FY 2023-24, the report said. India ranked as the fourth-highest funded country globally in FY 2025-26, behind the US, UK and China, and ahead of Germany and France, Tracxn said. By stage, seed funding slipped 15% to $1.3 billion from $1.5 billion in FY25.
Early-stage funding rose to $4.8 billion, up 33% from $3.6 billion in FY25 and 37% from $3.5 billion in FY24. Late-stage startups raised $5.6 billion, a 38% drop from $9.2 billion in FY25 but an 18% increase over $4.7 billion in FY24, the report noted. Thirteen funding rounds topped $100 million in FY26, compared with 23 such rounds in FY25 and 13 in FY24.
Large deals were driven primarily by Enterprise Infrastructure, Enterprise Applications and FinTech, with notable raises including Nxtra’s $710 million private equity round, Neysa’s $600 million Series B and Inox Clean Energy’s $344 million Series D, the report said.
Sectorally, the report said FinTech and retail emerged as top-performing areas in FY26. Enterprise Applications attracted $3.6 billion, unchanged from FY25 and 23% higher than the $2.9 billion in FY24. FinTech firms secured $2.4 billion, up 14% from $2.1 billion in FY25 and 27% from $1.9 billion in FY24.
Funding for retail startups totaled $2.4 billion, down 32% from $3.5 billion in FY25 and 19% below the $2.9 billion raised in FY24. Despite the funding slide, IPO activity accelerated. The report said India Tech recorded 47 IPOs in FY26, a 52% increase over 31 in FY25 and a 47% rise from 32 in FY24.
Major IPOs during the year included Lenskart, Groww and Meesho, according to the report. Six new unicorns were created in FY26, up from four in FY25, it added.